CHARLES SCHWAB CORP.: 1,880

Jobs to be cut as trade volume falls

September 18, 2002|By From Tribune news services.

SAN JOSE, Calif. — Charles Schwab Corp. said Tuesday that it will cut about 10 percent of its workforce, or roughly 1,880 jobs, as the discount and online brokerage continues to struggle with weak trading volumes.

The company also said it might miss its third-quarter earnings forecast of 8 cents a share.

In August, the San Francisco-based company hinted that it would be making cuts but provided no numbers. At that time, it had about 18,800 employees.

It was not immediately known which units would be targeted by the layoffs, which are expected to be completed by the end of November, said Greg Gable, a Schwab spokesman.

Schwab reported that clients made an average of 117,500 daily trades in August, down 25 percent from July. The figure excludes mutual funds trades. Trading activity fell even further in the first nine days of September, to an average daily volume of 100,000 trades.

"[The beginning of September] was weaker than I was anticipating," said Jeffrey Harte, an analyst at Sandler O'Neill. "The real thing with Schwab is when does retail investor activity pick up again. Whether they miss [earnings] this quarter by a penny or not really isn't . . . the driving issue for the stock."